When big Florida nursing home companies pushed a new state funding plan in 2017, they sold it as an opportunity to increase accountability, efficiency and quality at the state’s long-term care facilities.

But there was something missing from the sales pitch: Many of Florida’s best nursing homes are expected to lose millions of dollars under the plan.

Sixty-five of the state's highest-rated nursing homes are expected to take a financial hit under the new system, which was implemented late last year, a USA TODAY NETWORK – FLORIDA analysis of nursing home payment rates found.

A physical therapy assistant works with a resident on his gate and balance at Bon Secours Maria Manor nursing home in St Petersburg, Fla., on Feb. 12, 2019. Bon Secours, which is a highly-rated nonprofit home, is expecting to receive almost $850,000 less per year under a new Medicaid payment plan signed into law in 2017.(Photo: Beth Reynolds / Special to Naples Daily News)

Over the past year, a USA TODAY NETWORK – FLORIDA investigation has shown that more than 50 of Florida’s worst-performing nursing homes continue operating without fear of serious consequence, even after patients have died due to neglect or mistreatment.

Florida’s new nursing home payment system is expected to reward most of those same homes, with no guarantee they will spend the extra money they receive on improving patient care.

Proponents of the change say they expect it to improve overall nursing home quality, in part by leveling the playing field. Under the previous model, nursing homes often were funded at wildly different rates, based in part on their spending on patient care.

That's little solace to leaders at Bon Secours Maria Manor, a highly rated nonprofit nursing home in St. Petersburg. Bon Secours is expected to be reimbursed $13 less per patient per day, or about $850,000 less every year, under the new nursing home payment system, a system ostensibly designed to reward quality, the USA TODAY NETWORK - Florida analysis found.

Buy Photo

The Bon Secours Maria Manor nursing home in St. Petersburg, Fla., shown Feb. 12, 2019. Bon Secours, which is a highly-rated nonprofit home, is expecting to receive almost $850,000 less per year under a new Medicaid payment plan signed into law in 2017.(Photo: Beth Reynolds / Special to Naples Daily News)

“These kinds of cuts for us as a nursing care center are simply not sustainable, and really we would be faced with the existential question of how we could continue,” Kip Corriveau, a Bon Secours executive, testified before a Florida Senate committee in 2017.

Clout after contributions

Changing how the state distributes Medicaid payments was a victory for the biggest players in Florida’s nursing home lobby, which includes the Florida Health Care Association, the state’s largest advocacy group for long-term care providers, and Consulate Health Care.

The nursing home lobby has clout in the Capitol after contributing millions of dollars over the years to the political campaigns of powerful lawmakers — about $2 million per election, according to a the Network's analysis of campaign contributions.

When a House committee tried to torpedo the nursing home payment overhaul in early 2017, deeming it not ready, FHCA reworked the plan with its members. FHCA then turned to legislative leaders, whose campaigns the association has invested in over the years, to resurrect the proposal in a separate bill and pass it.

FHCA leaders said the new nursing home Medicaid payment system already is improving patient care. Citing its own recent study of federal data, the association said Florida ranked better than most other states in overall nursing home care.

“Our members are committed to quality,” Emmett Reed, the association’s executive director, said during a recent news conference laying out the organization’s 2019 legislative priorities for reporters.

Profits trumped patients in this case, said Elliott Palevsky, CEO emeritus at River Garden Senior Services, which runs one of the state’s top-rated homes, in Jacksonville. River Garden leaders spoke against the plan, even though their home is slated to receive about $300,000 extra per year because of it.

“Florida Health Care will, as a matter of serving its membership, support whatever will put more money into the pockets of ownership,” Palevsky said.

“Sometimes it’s good public policy. Most of the time, good public policy is secondary.”

Winners and losers

The linens budget. The technology budget. The maintenance budget.

Those are just a few of the places Corriveau said his team is looking for savings in anticipation of Medicaid cuts to Bon Secours in the coming years.

Buy Photo

Kip Corriveau, shown Feb. 12, 2019, is director of mission at Bon Secours Maria Manor nursing home in St Petersburg, Fla. Bon Secours, which is a highly-rated nonprofit home, is expecting to receive almost $850,000 less per year under a new Medicaid payment plan signed into law in 2017.(Photo: Beth Reynolds / Special to Naples Daily News)

Founded on a mission of helping the poor and the dying, about 70 percent of this 274-bed nursing home’s patients are on Medicaid, a health care program for for low-income residents and seniors.

Bon Secours has always lost money on Medicaid patients, Corriveau said. With less money from the state, they will likely have to accept fewer elderly, poor patients.

“Nothing is kind of off the table. So, will we have to close units? Will we have to lay off people?” Corriveau said in an interview. “There’s a limit of how hard you can squeeze before you get to the point of having to do with less staff.”

New way to pay

Florida's new payment model came after other states changed the way they distributed Medicaid money, hoping to simplify the payment and audit process.

Under the previous model, the state reimbursed nursing homes retroactively, based on their costs.

Buy Photo

A staff member chats with a resident at Bon Secours Maria Manor nursing home in St Petersburg, Fla., on Feb. 12, 2019. Bon Secours, which is a highly-rated nonprofit home, is expecting to receive almost $850,000 less per year under a new Medicaid payment plan signed into law in 2017.(Photo: Beth Reynolds / Special to Naples Daily News)

The result was that the highest-paid nursing homes in Florida received more than $100 per patient per day more than the lowest-paid nursing homes. Many nursing homes took advantage of incentives built into the model that reimbursed them more if they spent more on direct patient care.

The new prospective model was designed to pay nursing homes a predetermined rate, with quality of care one component of the funding formula.

Not every top-rated nursing home loses money, and not every poor-performing home gains under the new system. But the Network's analysis of the new rates found that dozens of the best-performing homes could lose millions when the changes are fully implemented, and many low-rated nursing homes could receive millions more.

The Network’s analysis identified the quality of nursing home care over time by averaging quarterly nursing home ratings between 2013 and 2017 from the federal Center for Medicare and Medicaid Services, which rates homes on a five-star scale, with five stars being the best.

The analysis found about 1-in-4 homes that averaged four to five stars during the 5-year period, are forecast to lose money under the new system, more than $15 million combined.

The four-star Bayside Care Center in St. Petersburg, for instance, would lose almost $1.5 million annually, according to USA TODAY NETWORK - FLORIDA's analysis. Sunnyside Nursing Home, a five-star nonprofit Catholic home in Sarasota, would lose more than $300,000, or nearly 12 percent of its annual Medicaid payments.

Leaders of the two homes declined to comment for this story.

On the flip side, 53 nursing homes that averaged two stars or fewer between 2013 and 2017 are projected to receive more money, an additional $25 million combined.

Bayside Care Center, a 4-star St. Petersburg nursing home, would lose almost $1.5 million annually under a new Medicaid payment plan approved by lawmakers in 2017, according to a USA TODAY NETWORK - FLORIDA analysis.(Photo: Ryan Mills)

Consulate’s 76 Florida nursing homes, which averaged 2.4 stars over the five-year period, could see annual payment increases of more than $30 million combined, according to the analysis.

Consulate Health Care of Vero Beach, which averaged 1.1 stars during the period, is projected to receive an additional $630,000 each year under the new system, an 8 percent increase over 2016, according to USA TODAY NETWORK's analysis.

Even some nursing homes where patients died from staff neglect and mistreatment could get additional money.

Consulate Health Care of Jacksonville, which averaged 1.3 stars during the five-year period, is projected to receive an additional $14 per patient per day, or more than $342,000 per year under the new system, a 6.5 percent increase.

York Spratling, 84, died in February 2017 after surgery to remove dead tissue from his gangrenous genitals. He was a resident at Consulate Health Care of Jacksonville.(Photo: FAMILY PHOTO)

Consulate spokeswoman Jennifer Trapp said the company expects only “a modest percentage increase in reimbursement rates,” when the new payment system fully takes effect in the coming years. She said the previous system, which paid nursing homes more if they spent more on care, rewarded “extreme inefficiency and waste."

“We believe that all providers should receive the same reimbursement rate for providing the same services,” Trapp wrote in an email.

Opponents of the new payment system argue that many of Florida's best nursing homes provide a higher level of service.

Reimbursement rates will be recalculated when the new payment system is fully implemented in 2023, taking into account each nursing home’s quality scores and costs, said Kristen Knapp, a FHCA spokeswoman. There is no way to predict what those rates will be or how much each home will receive.

“What we know is we’re seeing positive results in quality care today,” Knapp said in an email.

Corriveau said he doesn’t oppose the concept of a simplified payment system, but he opposes the formula lawmakers approved.

“Frankly," he said, "I feel like the formula was cooked to benefit certain providers."

A powerful lobby

Surrounded by dozens of people in Consulate Health Care T-shirts, Corriveau saw what he was up against when he traveled to Tallahassee in 2017 to speak out against the nursing home Medicaid overhaul supported by the huge, for-profit long-term care company.

But winning this battle was about more than just manpower and letter-writing. It also was about money.

Medicaid programs account for about $28.3 billion of state spending this year, or roughly a third of Florida’s $88.7 billion budget.

To influence lawmakers, FHCA pays 26 lobbyists associated with nine Tallahassee firms, according to state lobbying disclosure records. In 2017, the long-term care group paid lobbyists between $210,011 and $509,970, according to the records, which include only payment ranges and not exact amounts.

That doesn’t include payments to lobbyists made by individual nursing home companies, or to the five FHCA employees who also are registered lobbyists, according to disclosure records.

The industry also contributes millions of dollars to the political campaigns of powerful lawmakers, typically those who control the House and Senate, and key committees.

Former Senate President Joe Negron was a strong advocate for changing the way nursing homes are paid.(Photo: Joe Rondone/Democrat)

Over the last four election cycles since 2012, former Senate President Joe Negron, R-Stuart, received at least $240,000 from the nursing home industry, including contributions to his campaign and political committees, according to USA TODAY NETWORK – FLORIDA's analysis of state campaign finance data. That's the third-most of any candidate since 2012, the Network found.

FHCA praised Negron for being a strong advocate for the Medicaid overhaul and named an annual award after him when he stepped down from the Legislature last year, after the new payment system was passed.

Negron did not respond to requests for comment left on his cellphone and in emails.

U.S. Sen. Rick Scott, R-Fla., the state's former two-term governor, signed the nursing home payment overhaul into law in 2017.(Photo: File)

U.S. Sen. Rick Scott, the former two-term Republican governor who signed the nursing home payment overhaul into law, received more than $460,000 from the nursing home industry since 2012, the most received by any candidate in the state, according to the Network’s analysis.

The year before the overhaul was signed into law, Scott included a half-million dollars in his budget to develop the new payment plan.

The nursing home industry contributed more than $8 million to state campaigns over the four election cycles That’s an average of more than $2 million per election, according to the analysis of contributions from individual nursing homes, corporate owners, executives, administrators, industry associations and industry-affiliated political committees.

More than two-thirds of the industry’s contributions, or about $6.4 million, went to Republican candidates and their political committees. Republicans have dominated Tallahassee politics for 20 years and control most key leadership positions.

FHCA was the industry’s top political contributor. Its political committees contributed more than $3.2 million during the period, primarily to Republican lawmakers and groups.

Consulate Health Care contributed more than $1.3 million, including money from its corporate office, management company and individual Consulate nursing homes.

Knapp, the FHCA spokeswoman, said the group provides political contributions and education to candidates who understand the industry’s priorities.

In recent years, FHCA has used its clout to defeat measures intended to improve care and to pass legislation that financially benefits to its members.

That same year, FHCA boasted of its ability to stop an “unfriendly” bill that would have mandated a $1 million state penalty against nursing homes where patients died from abuse or neglect.

Dooming high performers?

In February 2017, two consultants hired by the state presented their plan for overhauling Florida’s nursing home payment process to a skeptical House subcommittee.

Several lawmakers raised concerns about low-quality homes getting more money.

Cary Pigman(Photo: CONTRIBUTED PHOTO FROM CARY PIGMAN)

“With this methodology, may we be dooming certain high-quality performers to failure?” asked state Rep. Cary Pigman, an Avon Park Republican and emergency room doctor.

Martin Goetz, the current CEO at River Gardens, the five-star Jacksonville nursing home, said the proposal would “destabilize the field” and result in people losing their jobs as costs were cut.

“I urge you not to put profits over people,” he told the committee.

A FHCA representative called the plan a “great start” and recommended some tweaks to the model.

A week later, the subcommittee shelved the proposal, deeming it in need of work and vowing to come back to it over the summer. It appeared to be dead.

Even though the House committee torpedoed the proposal, FHCA kept pushing it through the Senate. Negron and other top legislators approved a reworked version during negotiations near the end of the session.

Goetz said he was not against simplifying the nursing home payment system, but the state should ensure that welfare dollars are spent on direct patient care.

“When push comes to shove, there’s no requirement at all that these public funds be used for a public purpose other than the windfall profits of the Consulates of the world,” Goetz said. “Along the way, in developing this pricing model, you see that there are some providers, good and bad, for-profit and nonprofit, that get hurt by it.